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CLASS 2

CLASS 2. Account Receivable & Account Payable. A/P- Case: Chai Tea Room. Business Background Chai Tea Room serving specialty teas from all around world, also provides light lunches and superb dessert,coffee and other beverage

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CLASS 2

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  1. CLASS 2 Account Receivable & Account Payable ACC1215 Accounting Simulation

  2. A/P- Case: Chai Tea Room • Business Background Chai Tea Room serving specialty teas from all around world, also provides light lunches and superb dessert,coffee and other beverage Chai Tea Room does not pay HST on its food purchase, but its other purchases subject to HST, and HST 13% is charged to customer on all good and service in cafe. To keep the cafe clean, their supplier “Sudbury Cleaning” do clean and wax the floor, and steam clean the carpets and furniture once a week. Instruction: • Supplier Information • Accounting Procedures • Open Invoice Accounting for Payable, not using General Journal • Discount: when payment term are set up correctly for supplier, and the date are entered correctly, discount are calculated automatically and credit to “ purchase discount”, contra expense account with credit balance and reduce overall expenses • Purchase of Inventory Item and Cost of Good Sold Food purchased are recorded in inventory asset account, usually at month end, manager will count inventory and determine the value of item remaining in inventory. Then, manger will issue the memo to reduce the inventory (assets account) and charge the cost price to Cost of Good Sold (expenses account).

  3. Chai Tea Room (1)Session Date: August 7,2013

  4. Chai Tea Room (1)Session Date: August 7,2013

  5. Chai Tea Room (1)Session Date: August 7,2013

  6. Chai Tea Room (1)Session Date: August 14,2013

  7. Chai Tea Room (1)Session Date: August 21,2013

  8. Chai Tea Room (1)Session Date: August 21,2013 • Report: • Display Supplier Aged Report • Display purchase journal • Display payment journal • Recurring Transactions Report

  9. A/R- Case: AirCare Services • Business Background: providing solar energy. Revenue come from installation, repair and subcontracting. Instruction: • Customer Information • Accounting Procedures: • Open Invoice Accounting for receivables • Discount for earlier payment • NSF Cheques • Cash & Credit Card Sales of Services

  10. AirCare Services (1)Session Date: May 8, 2013

  11. AirCare Services (1)Session Date: May 8, 2013

  12. AirCare Services (1)Session Date: May 8, 2013

  13. ASSISGNMENT 2- Due: Oct 17/18 • Format: In Class Group Project • Requirement: review the cases of today • Chai Tea Room • Aircare Services Complete all entries as per request • Submission methods • Submit in class with instructor’s review • Submit in backup format with your USB.

  14. Midterm – Oct 17/18 • Multiple Choices: 18x 4marks/question=72 • Short Answers: 4x7marks/question=28 • Total Marks 100 How to prepare? • Install the Simply Accounting Software • Do sample exams, get yourself familiar with the each modules: General Journal, A/R, A/P • Find your sample exam attached in your student account in Words Doc. • Answers to Sample exam are blue colored.

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